The conflict in Iran unleashed the worst energy crisis in history, worse than the previous crises of 1973, 1979 and 2022 combined, according to the International Energy Agency. Energy price rises are set to push up production costs – with 82% of manufacturers expecting to raise prices as a result.
A spokesperson for the FDF said: “Looking ahead, the outlook confidence score for the next quarter remains deeply negative at -51%. The sector is calling on Government to support energy costs and minimise regulatory burdens to help ease the strain on businesses.
“Higher inflation is unavoidable. We forecast food inflation will reach 9-10%. Yet maintaining market share remains the industry’s top priority (82%). But fragile household finances leave little room to pass through rising costs. Rising labour costs continue to accelerate automation (53%), while negatively affecting bonuses (47%) and pay differentials (36%). The sector vacancy rate fell to 3.9% in Q1, down from 5% in Q4.”